27 F.4th 771
D.C. Cir.2022Background
- P&ID (an Irish-owned engineering firm) contracted with Nigeria in 2010 to process natural gas; the contract was governed by Nigerian law and called for arbitration (London) under the Nigerian Arbitration Act.
- P&ID initiated London arbitration in 2012; the tribunal found Nigeria liable and awarded roughly $6.6 billion plus interest (now > $10 billion).
- Nigeria unsuccessfully sought set-aside in England (missed deadline); the Federal High Court of Nigeria later issued an unexplained set-aside order. English courts later found a prima facie case of fraud and scheduled a trial on that issue.
- P&ID petitioned a U.S. district court (under the FAA/New York Convention) to confirm the award; Nigeria moved to dismiss under the FSIA claiming sovereign immunity.
- The district court denied dismissal relying on the FSIA waiver exception (New York Convention membership); the D.C. Circuit affirms jurisdiction but rests its decision on the FSIA arbitration exception instead, holding that a foreign court’s set-aside is a merits issue, not a jurisdictional bar.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether FSIA’s arbitration exception §1605(a)(6) permits U.S. courts to hear a petition to confirm a foreign arbitral award | Arbitration agreement exists; award issued; New York Convention governs — exception applies | Award is invalid/enforced set-aside by Nigerian court, so exception does not apply | Arbitration exception applies; jurisdiction exists; validity of award is a merits question |
| Whether FSIA’s waiver exception §1605(a)(1) (via New York Convention accession) waives Nigeria’s immunity | Nigeria’s accession to New York Convention and agreement to arbitrate in a Convention state constitutes implied waiver | Nigeria contests implied waiver; raises policy concerns and reciprocity | District court relied on waiver, but D.C. Circuit did not decide waiver and instead affirmed on arbitration exception |
| Whether a foreign court’s set-aside order defeats U.S. subject-matter jurisdiction to confirm the award | Set-aside means no enforceable award, so no jurisdiction under arbitration exception | Set-aside is an affirmative merits defense and does not negate jurisdiction | A foreign set-aside is a merits issue and does not deprive the district court of jurisdiction |
Key Cases Cited
- Seetransport Wiking Trader Schiffarhtsgesellschaft MBH & Co. v. Navimpex Centrala Navala, 989 F.2d 572 (2d Cir. 1993) (leading Second Circuit decision on New York Convention accession as implied waiver)
- Creighton Ltd. v. Gov’t of State of Qatar, 181 F.3d 118 (D.C. Cir. 1999) (discusses FSIA exceptions and endorses Seetransport reasoning in dicta)
- Cargill Int’l S.A. v. M/T Pavel Dybenko, 991 F.2d 1012 (2d Cir. 1993) (New York Convention is the type of treaty covered by FSIA arbitration exception)
- Diag Human, S.E. v. Czech Republic—Ministry of Health, 824 F.3d 131 (D.C. Cir. 2016) (award finality and validity are merits questions, not jurisdictional)
- LLC SPC Stileks v. Republic of Moldova, 985 F.3d 871 (D.C. Cir. 2021) (defines arbitration agreement, award, and treaty as jurisdictional facts under §1605(a)(6))
- Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428 (1989) (FSIA is the sole basis for jurisdiction over foreign states in U.S. courts)
- Saudi Arabia v. Nelson, 507 U.S. 349 (1993) (foreign states are presumptively immune absent an FSIA exception)
- El-Hadad v. United Arab Emirates, 216 F.3d 29 (D.C. Cir. 2000) (denial of foreign state’s motion to dismiss on sovereign immunity is appealable under collateral order doctrine)
- Kirkham v. Société Air France, 429 F.3d 288 (D.C. Cir. 2005) (de novo review of district court’s denial of FSIA dismissal)